This follows two open hole DSTs that were carried out earlier and gave results respectively of 25,000 cubic feet of gas per day for DST-1A over the interval 1358-1449m and 250,000 for DST-2 over the interval 1740-1834.8m.

DST#3 was carried out over a section where high gas readings were observed in concert with a drilling break and electric logs showed crossover with a potential 10m net gas column.

The test recovered brine (completion fluid) that was gas cut and analysis of the pressure data indicated a tight formation.

DST-4 was performed over the interval 1532-1591m in the Golden Beach Formation sands, which is the productive reservoir at the nearby offshore Kipper Field and flowed at a maximum rate of 100,000 cubic feet of gas per day on a ¼" choke.

The next test will be in the Golden Beach over the interval 1497-1515m. Indications during drilling suggest that this is the primary zone of interest.

This will be followed by a test in the Latrobe Formation, which is the productive formation in the giant Bass Strait oil and gas fields.

"Testing of gas shows at Wombat by Lakes Oil shows only academically interesting gas flows and the discovery is unlikely to be commercial with such small flows," said independent analyst, Peter Strachan.

Euroz analyst, Ollie Foster, said the stock has had a good run and people were probably selling on the less than bullish news.

The stock opened at 8.4 cents but quickly dropped to 7.2c before recovering slightly to be trading at 7.4c at press time.

The Wombat-1 well is the first well on the Wombat structure and is only 4 kilometres from the Esso-BHP gas pipeline and 15 kilometres from the Longford gas plant.

Lakes Oil has retained a 92.5% interest in the Wombat Block subject to a 5% overriding royalty held by Roma Petroleum.